Interdependence between taxation, cultural values and the role of the state in economic life
Interdependence between taxation, cultural values and the role of the state in economic life

Summary/Abstract: The role played by the state in economy is one of the most important problems in economic science. With regard to this role and its importance, it is often forgotten that the state is largely influenced by the cultural values of its citizens. This paper evaluates the role of cultural values in explaining the differences in state tax revenues as percentage of GDP in cross-country perspective. Our results suggest that there is a statistically significant relationship between shared cultural values and taxation (measured by the revenues that are accumulated by the state). Therefore, it seems to be important to take culture into account when designing optimal economic policies and influencing the level of life and well-being.

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